Time is Money; $340B+ More Specifically

Supersonic jets went dormant out of cost & environmental concerns and a limited market. They are now being revived by private companies moving quickly to advance the state of the art (UBS est: $160B new jet market through 2040) for business jets ($85B market) and commercial jets ($75B market + $180B for operators)—see interactive model. We see supersonic bizjets viable in the late-'20s and supersonic commercial jets in the mid-to-late-'30s with hypersonic travel a decade later. Implications beyond aero/airlines include airfreight, lodging and broader industrials as just-in-time is redefined (30%+ time savings potential).

Will regulations on speed slow everything down?

Good engineers can solve a lot, but policy isn’t one of them. For aircraft-over-land speed limits to evolve to noise limits, policy will need to change. Players aren’t relying on that change for initial plans. There are plenty of other tech-to-dos: advanced aerodynamics to thermal management to reliable, efficient and environmentally friendly propulsion.

UBS Evidence Lab: What are consumers’ thoughts on high speed travel?

UBS Evidence Lab survey of 6k+ respondents show flyers are willing to pay for speed (25%+) and we expect business travelers and, in particular, business jet owners will absorb even more (i.e. the last decade of bizjets that carried 25-30% price step ups on incremental capability). Near-term COVID-19 effects have minor impact on the development plans, but the vulnerability of commercial air likely reinforces biz jet adoption while delaying adoption by an airline industry in recovery.

Explore other articles you may find interesting